Commercial corridor revitalization

Before making investments in this strategy, city and county leaders should ensure this strategy addresses local needs.

The Urban Institute has developed an indicator framework to help local leaders assess conditions related to upward mobility, identify barriers, and guide investments to address these challenges. These indicator frameworks can serve as a starting point for self-assessment, not as a comprehensive evaluation, and should be complemented by other forms of local knowledge.

The Urban Institute's Upward Mobility Framework identifies a set of key local conditions that shape communities’ ability to advance upward mobility and racial equity. Local leaders can use the Upward Mobility Framework to better understand the factors that improve upward mobility and prioritize areas of focus. Data reports for cities and counties can be created here.

Several indicators in the Upward Mobility Framework may be improved with investments in commercial corridor revitalization. To measure these indicators and determine if investments in these interventions could help, examine the following:

• Economic inclusion: Share of people experiencing poverty who live in high-poverty neighborhoods. These data are available in the Census Bureau’s American Community Survey.

• Racial diversity:Index of people’s exposure to neighbors of different races and ethnicities. These data are available through the Census Bureau’s American Community Survey.

• Opportunities for income: Household income at 20th, 50th, and 80th percentiles. These data are available from the Census Bureau’s American Community Survey.

• Access to jobs paying a living wage: Employment-to-population ratio for adults ages 25 to 54. These data are available from the Census Bureau’s American Community Survey and the Bureau of Labor and Statistics’ Local Area Unemployment Statistics.

• Employment opportunities: Ratio of pay on an average job to the cost of living. These data are available from the Bureau of Labor and Statistics’ Quarterly Census of Employment and Wages.

• Safety from crime: Reported property crimes per 100,000 people and reported violent crimes per 100,000 people. These data are available from the Federal Bureau of Investigations’ Uniform Crime Reporting Program.

• Strengthening neighborhood-level capacity coordinate action: Commercial corridors, particularly those with diffuse ownership, face a collective action problem. However, the solutions that drive commercial revitalization generally require coordination across business owners, landlords, residents, and other partners. Therefore, a foundational part of commercial corridor revitalization is strengthening the neighborhood-level capacity to coordinate, project manage, fundraise, engage community, and perform related functions. These outcomes can be achieved through a variety of structures, however business improvement districts, community development corporations, or other nonprofit or quasi-governmental models are most common (see Main Street America for more). The key is that the organization is trusted and accessible to stakeholders on the corridor. Local governments, businesses, and philanthropic organizations can play a key role in standing up these organizations and providing them with stable, long-term funding. As an example, the City of Philadelphia provides both direct grants to CDCs and tax credits to businesses that support CDCs.

• Incentivizing local ownership of commercial properties: Passive property owners responsible for persistent vacancy and/or neglect of properties are a challenge to revitalization in many commercial districts. While local jurisdictions often have punitive measures that can be levied against these actors, like targeted code enforcement, these measures are often not enough on their own to secure high-quality, productive tenants. To combat this, jurisdictions should incentivize local ownership of commercial properties. There are multiple approaches to localizing ownership, including: (1) coordinating with local investors; (2) providing affordable and flexible financing and technical assistance for local small business owners to purchase properties; and (3) establishing organizational structures, like commercial community land trusts, cooperatives, community-owned stores, and others. (For a deeper dive on these approaches, see this resource from the Brookings Institution.) Strong examples of efforts to localize ownership of commercial properties include the Cincinnati Center City Development Corporation and the East Portland Community Investment Trust.

• Improving the physical condition of commercial districts: Local governments are typically responsible for the maintenance of and improvements to the physical environment in commercial districts. Both basic maintenance activities, like trash pickup and street sweeping, and infrastructure projects, like planting street trees or installing additional lighting, can support the revitalization of a commercial corridor. These efforts are most effective when they make a district cleaner, safer, and more comfortable for residents and visitors. When municipal services are inadequate, neighborhood-level actors, like business improvement districts, can organize “clean and safe” programs to address maintenance needs, while continuing to advocate for additional public services. These programs typically employ “ambassadors” who pick up litter, perform other basic maintenance functions, and respond to other quality of life concerns. More broadly, infrastructure and capital projects present an opportunity to advance wider-ranging goals that support a commercial corridor, like increasing foot traffic. For example, installing public art projects or supporting cultural activities can deepen a corridor’s “sense of place” by celebrating the community’s culture and history. Additionally, climate and disaster resilience projects, like the installation of permeable surfaces, can mitigate risks residents and businesses face.

• Providing technical assistance for businesses: Technical assistance (TA) programs can ensure that small businesses have the tools they need to be successful. Common areas of focus for TA programs for small businesses include financial readiness, long-term and emergency financial planning, e-commerce, and compliance with local permitting and licensing requirements. (Note: when small businesses need support navigating municipally-controlled processes – like licensing and permitting – local governments may choose to simplify those processes rather than offer or support TA.) Most often, these services are provided by nonprofit organizations, with funding from local government and philanthropic partners. Local government leaders can promote the effectiveness of TA by coordinating across service providers to reduce redundancy in programming, ensure all communities have access to high-quality TA providers (e.g., by certifying or testing the quality of providers), and align program offerings with the needs of business owners.

• Increasing access to grants and financing opportunities: Local leaders may also leverage financial tools to support the revitalization of a commercial district. Grant or low- or no-interest loan programs are commonly established to provide for storefront improvements (e.g., signage, awnings), in-store improvements (e.g., equipment and furnishings, technology, tenant fit-out), or to help small businesses navigate shocks (e.g., natural disasters, long-term street closures). Additional support for operational needs, like working capital for staffing, inventory, or equipment, is generally provided through increasing access to financing. Lenders with a community development focus, like Community Development Financial Institutions (CDFIs) or non-profit economic and community development organizations, are generally the most accessible for small businesses in under-resourced commercial districts and can partner with commercial banks to meet larger needs. Local governments can further expand access to financing by providing funding to lenders to either subsidize interest rates or to provide a “backstop” to enable lenders to take on higher-risk loans.

• Focus resources in areas with greater need: In most communities, commercial corridor revitalization efforts are most needed in districts that primarily serve low- and moderate-income households and households of color. Focusing on improving conditions in commercial districts most in need represents an opportunity to reduce the disparity in access to amenities and services between neighborhoods in a jurisdiction. Revitalization strategies that increase employment opportunities or promote wealth building also represent opportunities for local leaders to leverage commercial corridor revitalization efforts to address broader disparities in economic outcomes.

• Engage community to ensure goals reflect neighborhood priorities: Residents and merchants along a commercial corridor want strategies that are culturally competent and reflect their aspirations for their community. Building local capacity – such as through a business improvement district or community development corporation – ensures there are staff “on the ground” that can bring neighborhood-specific knowledge to bear across revitalization projects. More broadly, experts advise adopting a community engagement framework when engaging community members on revitalization projects. Frameworks, like IAP2’s Spectrum of Public Participation, help facilitators set clearer expectations with community members by clarifying the role and the extent of the public's influence on projects. Establishing partnerships with other community-based organizations – like libraries and schools – that can serve as conduits to residents and other neighborhood stakeholders is another promising approach.

• Neighborhood-level CBOs: Neighborhood-level community-based organizations, like community development corporations or merchants associations, can provide coordinating capacity for revitalization efforts on a commercial corridor. More broadly, these organizations and others, like libraries and arts and cultural institutions, can provide feedback to local leaders on a neighborhood's goals and priorities and ensure placemaking and other efforts align with the community’s identity.

• Economic and community development department: Municipal economic and community development staff provide technical expertise on supporting existing and securing new commercial tenants. In some jurisdictions, departments may include staff dedicated to supporting small business development.

• Small business development centers: SBDAs provide counseling, training, and other resources to support small businesses.

• Public works or transportation department: Improvements to the street, sidewalk, or other elements of the public right-of-way are key aspects of commercial corridor revitalization and are typically managed by public works staff.

• Buildings department: Buildings departments, or their equivalent, generally administer permitting and licensing processes for commercial spaces and businesses. Fast, transparent permitting and licensing can make securing commercial tenants easier.

• Planning department: Planning departments develop and administer local zoning ordinances. Ensuring zoning codes allow for the types of commercial and residential uses that are desired in a corridor is an important enabling condition for revitalization efforts.

• Lending institutions: Lending institutions, like CDFIs and non-profit lenders, can help small businesses in a commercial corridor better access financing.

• Social services organizations: Social services organizations, alternative emergency response programs, and other professionals who are equipped to support homeless individuals and address mental health crises can be key partners in reducing quality of life concerns along a corridor.

• Conduct a diagnostic for commercial districts: Before launching a revitalization effort, local leaders should conduct an assessment to better understand the strengths and needs of commercial districts in their jurisdiction. These types of diagnostics can help local leaders identify “easy wins” for a corridor that leverage its existing strengths and determine which additional revitalization strategies may be most appropriate given the local context. A common initial step when conducting a diagnostic is compiling a comprehensive list of local stakeholders for a corridor. For more on this and subsequent steps, see LISC’s guidebook, authored by Larisa Ortiz.

• Adopt a whole government approach: The actions needed to push forward a commercial corridor revitalization effort must be taken across local government – from public works to planning departments. As such, revitalization efforts will be most successful when they take a “whole government” approach that synchronizes actors within government on which corridors are being prioritized and what the goals are for those corridors. Examples of this approach are the City of Cleveland’s (OH) Integrated Development team, which coordinates across the jurisdiction’s Economic Development, Planning, Building and Housing, and Community Development Departments, and the City of Detroit’s (MI) Strategic Neighborhood Fund, which coordinates across public, philanthropic, and community-based partners.

• Commercial vacancy rates: The proportion of commercial storefronts that are vacant is a standard measurement of commercial corridor health. However, using this metric without context can be misleading, as it can hide instances where existing small businesses are being displaced.

• Rate of owner-occupancy: Reductions in the proportion of properties that are owner-occupied can be a signal that small businesses are being displaced.

• Activity units per square mile: The total number of jobs and housing units per square mile provides a more holistic view of market strength in a neighborhood.

• Foot traffic: Foot traffic counts collected over time can show how activity along a corridor is changing as a revitalization effort progresses. These can be gathered manually or using infrared devices.

• Indicators of market strength: Broader indicators of market strength – like total private capital investment and asking rents – can be helpful in demonstrating the success of a revitalization effort over time.

• Process outcomes: The process outcomes relevant to a revitalization effort will depend on the types of interventions used (e.g., number of storefronts renovated for a storefront renovation program). These metrics are easily interpreted and useful for demonstrating “concrete” impacts.

• Crime statistics: Crime statistics can help local leaders understand how well their approach is addressing property and violent crimes, both of which threaten the health of commercial corridors.

• Traffic safety: Metrics focused on traffic safety – like the number and location of collisions and the number of serious injuries and fatalities that result from them – speak to the safety and walkability of a commercial corridor, both of which support commercial activity.